If a service provided to a customer is considered a single or one-off event, it is natural to pay for it through a single transaction. The transaction may be performed using one of a variety of known mechanisms, such as electronic money or electronic purse, or the Secure Electronic Transaction (SET) protocol specified by credit card companies for making network payments.
On the other hand, if the service is continuous, it is to the advantage of the customer to pay for it in small increments, for example, once a minute for the next minute of service. With incremental payments the customer's losses remain small if delivery is interrupted; the loss is confined to the prepaid amount. Such an interruption may be intentional or unintentional. For example, in the middle of a the transmission of a movie the customer may decide to terminate the viewing, or there may be congestion in the network, which interrupts the delivery of the service.
Two problems have to be solved in order to control the delivery of a continuous service based on a sequence of received payments: (1) how to prevent theft and forgery of payments, and (2) how to implement a control mechanism by which the service provider is able to implement a decision to terminate the service.
The first of said problems can be addressed so that the customer terminal provides the payment messages with sequence numbers and adds a digital signature to each payment message. By checking the signature and the sequence number the service provider can easily detect payment messages that have been altered or duplicated during transmission; those messages are discarded. Digital signatures protect not only the customer but also the service provider: the customer cannot later repudiate a payment that has reached the service provider intact. A charging system utilizing digital signatures is described, for example, in an earlier PTC patent application PCT/FI97/00685 filed by the same applicant.
The solution to the second of said problems should be a control mechanism that can function in internetwork environments (such as the Internet), where the regular arrival of payments cannot be relied on, due, for example, to variations in the network delay and lost messages. Therefore, the effect of the network on the performance of the control mechanism in relation to the customer must be minimized. In the customer-centric atmosphere, which prevails today, both the customers and the service providers expect that the customers can be treated individually, depending on the relationship that an individual customer has with the service provider. Thus, the mechanism should allow the service provider to offer personalized customer service. The mechanism should also be flexible so that it can be adjusted to various applications and environments.